In short
A business does not have one standard legal outcome when its owner dies. A sole trader’s assets and liabilities enter the estate process. A partnership may dissolve unless its agreement says otherwise. A company continues as a separate legal entity. A trust-operated business depends on the deed and who held the trustee and control roles.
The immediate task is to identify the structure and the person who has authority to act. Family members should not assume that access to the premises, passwords or a power of attorney allows them to operate the business after death.
What should happen first?
Confirm who legally owns the business assets and contracts.
A trading name does not answer that question. Check the Australian Business Register, ASIC records, company register, partnership agreement, trust deed, leases, licences, finance documents and asset titles.
Locate the Will and identify the executor.
If there is no Will or no executor who can act, someone may need to apply to the Supreme Court of NSW for letters of administration. An administrator has authority only after the grant. An executor’s authority comes from the Will, but banks and other asset holders may still require probate before allowing the executor to deal with particular assets.
A power of attorney does not fill the post-death gap. A general or enduring power of attorney ends on death.
Records, stock, premises and insurance should be secured promptly, but without presenting an unauthorised person as the owner, partner, director or trustee. Establish who can currently direct the bank, pay employees, deal with customers and sign urgent documents.
What happens if the deceased was a sole trader?
A sole trader and the business are not separate legal persons. Business assets owned by the deceased, together with the associated liabilities, form part of the estate administration.
There is no separate company that automatically continues trading. The executor or administrator must identify and secure the assets, debts, staff obligations, customer commitments, leases, licences and insurance. They can then consider whether an authorised temporary continuation, sale or closure best serves the estate.
The deceased’s individual ABN cannot be used after death. If the legal personal representative continues the enterprise while finalising the estate, the estate may need a new ABN and trust tax file number. A person who later inherits or buys the business needs their own registrations.
The business name also needs attention. ASIC has a process for recording the executor or administrator as legal personal representative and, if the business is transferred, for transferring the business name.
Not every contract or licence will travel with the assets. A personal-services contract may end, while a lease, finance facility, supplier agreement, insurance policy or regulated licence may require notice or consent. Review those documents before anyone promises customers that trading will continue unchanged.
What happens if the deceased was a partner?
Read the partnership agreement first.
For an ordinary NSW partnership, the default rule is that the death of a partner dissolves the partnership, but that rule is expressly subject to an agreement between the partners. A welldefined continuation or buyout clause may allow the surviving partners to continue the business and settle the deceased partner’s interest.
If the partnership is dissolved, the surviving partners’ authority continues only so far as necessary to wind up its affairs and complete unfinished transactions. It is not an unrestricted authority to carry on a new business using the deceased partner’s capital.
Partnership property is applied first to partnership debts and liabilities. The surplus is then accounted for between the partners. Subject to the agreement, the deceased partner’s estate may be entitled to the amount due for that interest. If the surviving partners keep using partnership assets before settling the deceased partner’s interest, the estate may be entitled to a share of the resulting profits or to interest, subject to the agreement and the Act.
A beneficiary does not automatically replace the deceased as a partner. Admission to management depends on the partnership agreement and any required consent.
These points describe an ordinary private partnership. Incorporated limited partnerships and some regulated arrangements have different rules and require separate advice.
What happens if the business is run by a company?
A registered company continues to exist when a director or shareholder dies. The company still owns its assets, owes its liabilities and remains party to its contracts.
If functioning directors survive, they can ordinarily continue managing the company subject to the constitution, applicable replaceable rules and their directors’ duties. The deceased’s estate administers the shares owned by the deceased, not the company’s bank account, equipment, premises or customer contracts.
A person who inherits the shares does not automatically become a director. Share transmission and transfer must follow the Corporations Act, constitution, shareholder agreement and company register requirements.
The greatest disruption can arise when the deceased was the company’s sole director and sole shareholder. Section 201F of the Corporations Act 2001 may allow an appointed personal representative or trustee administering the estate or property to appoint a director, including
themselves. Until that happens, the company may be unable to use its bank account, pay staff or make binding decisions.
That statutory route is narrow. It should not be described as a general rule for every soledirector death, and the Will itself does not appoint the replacement director.
Once control is restored, the director must assess the company’s current position before continuing to trade. A death can affect revenue, key-person capability, finance and guarantees. The fact that the company survived legally does not prove that ongoing trading is solvent or commercially workable.
What happens if a trust operates the business?
First identify the role the deceased actually held. They may have been an individual trustee, a director or shareholder of a corporate trustee, an appointor or principal, a unit holder, a fixed beneficiary or a discretionary beneficiary. Each role has a different consequence.
Trust assets are held by the trustee under the trust deed. They are not automatically personal assets that pass under the deceased’s Will.
If an individual trustee dies, the deed’s replacement process must be followed. The Trustee Act 1925 (NSW) also provides mechanisms for appointing a new trustee, and the Supreme Court can assist where an appointment is impracticable. Appointment alone may not complete every change: land, shares and other registered assets can require separate transfer or registration steps.
If the trustee is a company, the company does not die. The urgent question is whether it still has functioning directors and who controls its shares. If the deceased was the sole director and sole shareholder of the corporate trustee, section 201F may provide a route to appoint a new director.
The deed also determines what happens to an appointor or principal role and to any units. A discretionary beneficiary does not ordinarily own a fixed share of the trust’s underlying assets. A personally owned unit or share may be an estate asset, but the exact deed and rights must be reviewed before anyone assumes control.
Can the business keep trading while the estate is being administered?
Sometimes, but not automatically.
The authorised decision-maker needs reliable current information about cash, debts, tax, payroll, employee super, insurance, licences and customer obligations. Continuing an insolvent or uninsured operation can create further loss and personal risk.
The business structure determines whose money is being used. Estate money, company money, partnership money and trust money should not be mixed. Decisions should be recorded and made by the person who holds the relevant office or authority.
Notify banks, insurers, landlords, key suppliers and regulators with evidence appropriate to the entity. Avoid cancelling contracts or announcing a permanent closure before the documents have been reviewed; death does not automatically terminate every lease, licence, finance facility or customer agreement.
What are the possible outcomes?
Once you know who can act and whether the business is financially viable, that person can decide whether to keep it trading temporarily, transfer it to a beneficiary, sell it, close it or formally wind it up.
The legal steps differ. A sole-trader sale transfers estate-owned assets. A partnership continuation settles the deceased partner’s interest under the agreement and partnership law. A company transaction may involve shares or a sale by the company itself. A trust transaction must be carried out by the properly appointed trustee under the deed.
Our guide to estate planning for business owners is the companion “before death” article. This guide addresses what happens after the death has occurred. Where a business is to be sold, our business sale services can assist with the structure and transaction. The estate authority itself may require probate or estate-administration advice.
What should you decide next?
Do not begin by deciding who in the family should “take over”. Begin by identifying the legal structure, the present decision-maker and the documents governing the deceased’s interest.
Then establish whether the operation is financially safe to continue while the estate, co-owners and advisers decide whether it should be retained, sold or closed.
If a business owner has died and authority or continuity is unclear, contact Biz Lawyers & Advisory or call 1800 893 836 to identify the structure, governing documents and immediate legal steps.
This article provides general information only. The outcome depends on the business structure, governing documents, estate authority, financial position and individual circumstances, and specific legal and tax advice may be required.
Primary sources
Law and guidance checked 13 August 2026.
- Probate and Administration Act 1898 (NSW), particularly ss 44–46.
- Partnership Act 1892 (NSW), particularly ss 31A, 33, 38–39 and 42–44.
- Corporations Act 2001 (Cth), particularly ss 119, 124, 135, 201F and 1072A.
- Trustee Act 1925 (NSW), particularly ss 6, 9 and 70–71.
- ASIC — Having a Will as a sole director and sole shareholder.
- ASIC — After the death of a business-name holder.
- Australian Business Register — Deceased estate.
- Supreme Court of NSW — Applying for letters of administration.
